Whether you are seeking to convince your neighbors and friends or asking an investor to act, throw out your TV and listen/read the great speeches in the last link below. Learn about persuasive rhetoric. How do you reach and convince people who DISAGREE with you.
My favorite book to recommend is The True Believer: Thoughts on the Nature of Mass Movements by Eric Hoffer. CSInvesting seconds this recommendation.
The book provides a concise and astute portrait of the personality type that is drawn to authoritarian institutions, whether political or religious. Hoffer makes an excellent case that the mass movements – the fascists, the communists, and the various brands of religious fundamentalists, that have caused so much death, suffering, and chaos throughout history in their attempts to impose their values and belief systems on others, have all depended on people of basically similar character to fill their ranks.
The true believer, as Hoffer portrays him/her, is someone who yearns for certainty and fears ambiguity; who sees the world in dualistic terms, black and white with no gray areas; who prefers to simply follow orders, letting others make the hard ethical decisions; who revels in belonging to an exclusive group and looking down on outsiders, particularly if they belong to a group the leaders have chosen as scapegoats.
Every voter should read this book and then look at the world today – the politics of fear and division, the growth of fundamentalist religion, the strident bigots on talk radio and TV – and then start working to reduce the danger they all pose to the freedoms in our Constitution, to the separation of church and state, and to our standing in the world.
— Back to Mr. Rosenberg…………
There is no discussion about investing in the book, but in my opinion, it is extremely helpful in understanding markets. It conveys the nature of human behavior in mass–how people act as a group. One of his great examples is explaining why people riot. There is no reason and no logic. People just get caught up in it. Riots don’t end all at once, they end person-by-person—that is markets. People panic in a group, but they come back to their sense one by one. That is why stock move incrementally the way the do.
CSIMA (Columbia Student Investment Management Association): How should they think about investment and time horizon?
JR: Young people today in business are much more macro-oriented than micro-oriented. They spend much more time on what is going on in Europe or Federal Reserve policies. They don’t focus much on company specifics. Even when they do they have a very low level of confidence in what they are doing. It’s very unfortunate. I hate that they don’t teach financial history in business schools. If it was up to me, I would make financial history and all history a number one requirement for business schools. Understanding how a spreadsheet works can be learned on the job easily but understanding the continuum of history requires certain intellect. I cannot for the life of me under-stand why business schools are not teaching financial history.
My advice to young people, if they really want to be successful in this business, is to learn financial history. Learn history in general and then dig deeper into financial history and you will not be in such awe of everything that’s going on. I see the same problem in my office. People just don’t know any financial history and they think that everything that is happening is unusual. Everything else can be learned on the job.
The Course on The Economics of the Great Depression
In this five-lecture course, Dr. Robert Murphy reviews the causes of the Great Depression, the response of the Hoover administration, and the New Deal. The focus is more on economic analysis rather than historical narratives, contrasting the Keynesian interpretation of various events versus the Austrian explanation in particular. Topics include the operation of the gold standard and the allegation that it inhibited policymakers from implementing the “stimulus,” Herbert Hoover’s supposed austerity program, the Friedman-Schwartz theory that the Fed’s unwillingness to inflate led to the severe downturn in the early 1930s, recent academic research showing the cartelization effects of the New Deal, and the myth of wartime prosperity. Dr. Murphy’s book, The Politically Incorrect Guide to the Great Depression and the New Deal, would be very helpful for students, but it is not required for the course. All necessary reading materials are provided.
From: CSInvesting: I have no affiliation with Grants Publication whatsoever, but I am a fan of his work. I post this because if you want access to an incredible library of the past 35 years of financial history, then this is your chance. If you pay $349, ignoring the book and the six future issues, you have access to two issues per month from the past 35 years or about 840 issues at 42 cents per issue. Besides financial data, there are excellent case studies of valuation and financial euphoria/despair.
If you read through those issues (Of course, skimming over articles that don’t interest you.), then you would have the equivalent of an MBA/CFA/PhD in financial history plus a vast course in valuation on certain companies, bonds, and real estate in real-time over more than a third of a century. THIS IS A DEAL! See the offer below
Dear Almost Daily Grant’s reader,
The new edition of Grant’s Interest Rate Observer features a hard look at a zooming stock. The company behind the stock is widely appraised as one of the century’s greatest. Grant’s begs to disagree with that consensus view, as is our wont. Who or what might bring this shooting star down to earth?
Subscribers are also reading about. . .
–the newly crowned holder of the dubious title of America’s most indebted nonfinancial corporation. Would you buy these bonds? Your insurance company probably is.
–one of the few North American industries where value–and bearishness–abounds.
–a pair of struggling foreign debt collectors who may soon be getting a taste of their own bitter corporate medicine.
–a certain Asian behemoth which has managed to spawn a money supply nearly as large as that of America and the eurozone combined.
All this, plus an inspiring Fourth of July quotation by Thomas Jefferson, awaits you.
Sign up today for a trial subscription: six issues, access to the 35-year Grant’s archive and a signed copy of Jim Grant’s latest book, “The Forgotten Depression: 1921, The Crash That Cured Itself,” winner of the 2015 Hayek Prize, all for just $349 ($359 outside U.S. and Canada).
Click Here to begin a six-issue Trial Subscription to GRANT’S. This offer ends MONDAY, July 2, 2018.
Whitney Tilson through www.kaselearning.com will be teaching value investing and hedge fund entrepreneurship to the next generation of investors. His programs are aimed at experienced investors and are very hands-on, so they aren’t cheap ($1,500-$2,000/day), but for beginners, he is offering a free two-hour seminar, An Introduction to Value Investing, in midtown NYC (57th and 7th) on Wed., April 4th from 5:30-7:30pm, followed by a cocktail hour. If you’d like to come, just email email@example.com and Whitney will send you details.
Investing and Hedge Fund/Entrepreneurship “Boot Camp” And other Courses.
I attended Whitney Tilson’s and Glenn Tongue’s February 6th – 8th Boot Camp. I was initially skeptical but pleasantly surprised.
Overall, I was impressed with the learning materials, the organization, and most importantly, the participants who attended. Whitney and Glenn were brutally honest and forthright in showing the rise and fall of their business. One can know the lessons of Munger, Buffett, Graham, and behavioral finance but still fall into a pit. Our main enemy is likely to be ourselves. There were many lessons taught, but my promise of confidentiality prevents me from giving details. The course would not be appropriate for a rank beginner, but for an entrepreneur who wishes to launch their own fund.
The main value–besides the lessons taught–would be to cultivate relationships with the participants including Whitney and Glenn. I wouldn’t go to Whitney to help you get a job, but if you do a rigorous analysis of a company, I am sure Whitney or Glenn could give you honest feedback. And if they liked your work, they might suggest how you could reach a larger audience. Also, your classmates could help. The opportunity to build strong relationships with knowledgeable investors and hedge fund managers would be invaluable for someone beginning their fund.
Each day was ten hours long with meals and cocktails afterwards, so you had plenty of opportunity to develop relationships.
60% of the course was how to improve as an investor, 20% life lessons, and 20% how to build your hedge fund.
Make sure you receive at least a 10% discount on the course or other courses by using “CSI10“ when you register.
If you want details on my experience of the course and what you might expect, please don’t hesitate to email me at firstname.lastname@example.org with BOOT CAMP in the subject line. I will be happy to discuss with you.
Here are my notes of the comments from the other attendees:
“Regarding last week, I was super impressed by the material. I liked the practical nature of the lessons they taught – a lot of courses exist that cover investing philosophy, but this was unique in its applicability to a start-up manager like myself.”
“The main lesson I learned from the course was to keep it simple. Look for the easy investments.”
“I actually really liked the emphasis on short selling, because it tends to be one of the great struggles of hedge funds that need to be long & short to justify the carry but have difficulty executing on compelling short ideas in the midst of a bull market.”
“I would have liked more on portfolio construction because that is what I am struggling with. Ditto for risk management and small funds. Things I loved – the interaction of our group, the LL case, the mea culpas of what Whitney and Glenn did right and wrong.”
All the participants told me that they both enjoyed the boot camp and found it useful in developing their fund.
Future Boot Camps
Whitney solicited feedback each day, therefore, Whitney and Glenn should improve their course offerings.
I give a thumbs-up. To learn more about the boot camp/Kase Learning programs you can go to www.kaselearning.com.
Also, view a video
I will periodically update information on Kase Capital for interested readers. If you learn anything from reading this post it should be to KNOW THYSELF! The market is an expensive place to find out. John Chew
The hedge fund founder explains why his fund was “sucking the joy” out of his life — and why he’s turning its failure into a teachable moment.
Whitney Tilson’s Facebook friends surely thought he was on top of the world last summer.Photo after photo posted on the social media site tells the story of a rich, exciting life: There’s Tilson watching whales off the coast of Iceland. Next, he’s on the canals of Amsterdam with his wife and daughter. Just a few days later, he’s checking out Lenin’s tomb in Moscow. Last August he even climbed to the top of the famed Eiger mountain in the Swiss Bernese Alps, photographing every step of the arduous journey.
But to hear Tilson talk today, the reality was grim. After 18 years in the hedge fund business, his firm — Kase Capital Management — was losing money, and Tilson found himself dipping into hissavings to keep it afloat.
“I had lost my passion for the game,” Tilson confided in a two-hour, soul-searching interview about the events that led him to shut down his hedge fund last September. After gaining 184 percent, net — when the broader market was up only 3 percent — during the first 11 and a half years of his hedge fund’s existence, Tilson’s returns had been floundering. Since 2010, Tilson says, he trailed the Standard & Poor’s 500 stock index, and in 2017 he had lost almost 9 percent on the year by the time he shut down his fund. “In an ironic twist, I always built my firm to survive the worst storm, but it was a nine year bull market — complacency and sunshine — that took me out.”
Tilson is one of several veteran hedge fund managers, including Eton Park Capital Management’s Eric Mindich, Hutchin Hill Capital’s Neil Chriss, Eclectica Asset Management’s Hugh Hendry, and Blue Ridge Capital’s John Griffin, who called it quits in 2017. Small hedge funds come and go with great regularity, but the inability of the industry’s stars to profit as the stock market soared to new heights has raised questions about the viability of the model. Tilson was a much smaller player than the others — at his peak he managed only $200 million — but his experiences are a window into the headwinds that have faced these former masters of the universe.
What distinguishes Tilson from many of his peers is his willingness to talk about the long, excruciating road down. “It’s hard, after seven years at sucking at something, to wake up and tap-dance to work. So, I found myself getting distracted. I wasn’t physically getting out of shape; it was the opposite. I was going and climbing mountains. This one part of my life, I was miserable at; I was having no success. It’s hard to have the self-discipline to focus all your attention like a laser, and all your spare time on a particular part of your life in which you’re getting so much negative reinforcement.”
Last year, as his fund’s losses began to mount, Tilson says, “I didn’t feel like I could look my investors in the eye and say, “˜Look, I’m losing you money, but I’m not doing anything else, 18 hours a day that I’m awake, the only thing I am doing is trying to turn performance around.’ ” The vacation photos notwithstanding, Tilson says he even felt guilty attending his daughter’s soccer games. “My hedge fund was sucking all the joy out of my life.”
Tilson’s introspection is uncommon for those in the hedge fund business, where selfconfidence and salesmanship are as important to success as any investing prowess. As Tilson readily admits, managers cannot afford to be frank while they are going through turmoil, lest they further hurt their business — and their investors. “The last thing you want to do is air your dirty laundry. That will further shake the confidence of your investors.”
But there’s another reason for Tilson’s uncommon openness: His experiences, both positive and negative, have led him to create a whole new business, turning Kase Capital into Kase Learning (Kase stands for the first letters of the names of Tilson’s wife and three daughters). From a small conference room at the New York Athletic Club, Tilson has started teaching the perils and profits of investing in general — and running a hedge fund specifically — to aspiring youngsters who don’t come out of big seeding platforms like Julian Robertson’s Tiger Management or a multibillion-dollar hedge fund.
“Unless you are the lucky 1 percent who has the chance of learning in an apprenticeship, how are you supposed to learn how to do this?” Tilson says. “Nobody teaches the next generation. There is not one business school on the planet that teaches anything really usable to starting up your own hedge fund.
“It’s so rare to talk to a manager who is injected with truth serum, isn’t it?” he asks as he details his long bumpy journey through hedge fund land. “But I don’t give a crap anymore.”
In an age when an algorithm is the main competitor for many fund managers, what can we know that they don’t? Algos understand the data trail of history, but this trail provides only limited insight into the key lessons of financial history for investors. In this talk, first provided at the 62nd Annual CFA Institute Financial Analysts Seminar, Russell Napier discusses those 21 most important lessons from financial history that allow human beings to profit at the expense of the machines. 1 Hour on-line seminar Feb. 1, 2018. Register (CSInvesting.org: I believe it is free: https://www.cfainstitute.org/learning/events/Pages/02012018_138012.aspx
Regardless of whether you can attend, read relentlessly about financial, economic, and common history. Note what Jim Grant of Grant’s Interest Rate Observer says:
But our main goal is to tell you the next important event in the markets. And sometimes we succeed.
– As with the tech bubble in 1999
– The 2008 mortgage crash
– The 2009 recovery in financials
– And the 2012-13 rise in house prices
How have we been so prescient over the years?
We don’t have fancy, financial computer models or a team of MBAs and Ph.D.’s to help us make these predictions. And we don’t have access to any kind of special information.
But we have been immersed in the markets for over 30 years. And we’ve studied the financial history of the past 200 years. None of which guarantees clairvoyance—nothing does. What we do claim is the capacity to see the present in the context of the helpful lessons of the past.
Like when we warned about the mortgage debt bubble in September 2006.
From the Sept. 8, 2006 Grant’s:
“Overvalued,” we, in fact, judge trillions of dollars of asset-backed securities and collateralized debt obligations to be, and we are bearish on them. Housing-related stocks may or may not be prospectively cheap; they at least look historically cheap. But housing-related debt is cheap by no standard of value. For institutional investors equipped to deal in credit default swaps, there’s an opportunity to lay down a low-cost bearish bet.
368353935-GMOMeltUp J. Grantham says that the current market does not YET show the characteristics of a bubble despite being highly valued.
12/06/2017 Mises Institute
Arguably one of the greatest thinkers of the twentieth century, Ludwig von Mises created a framework for all of economic science beginning with the simple axiom that individuals act. In his magnum opus, Human Action, he described economics as a branch of the theory of human action and stressed how broadly it spans, far beyond a discussion of mere money and prices. Mises said, “Economics must not be relegated to classrooms and statistical offices and must not be left to esoteric circles. It is the philosophy of human life and action and concerns everybody and everything. It is the pith of civilization and of man’s human existence.” For Mises, it was imperative that everyone learns economics, calling it “the main and proper study of every citizen.”
Human Action is a challenging read. With over 800 pages of dense material, study tools are very helpful. The course, Advanced Seminar in Human Action, is a useful addition to other materials like the Human Action Study Guide.
In this course, leading Austrian economists walk the student through Human Action a chapter at a time.
If you’ve ever wanted a push to help you get through the book or if you’ve wondered about your own reading of the material, here is your opportunity to study Human Action with David Gordon, Joe Salerno, Jeffery Herbener, Peter Klein, Guido Hülsmann, and Mark Thornton.
Human Action by Ludwig von Mises is available for free on Mises.org and for purchase as a paperback and hardcover in the Mises Bookstore.
The teachers are excellent and Human Action is the Magnum Opus of Ludwig von Mises. The book is a DIFFICULT read but there is a study guide, lecture videos, and lecture slides for all the chapters of the book. You will have a strong grounding in economics and improve your reading and critical thinking skills, but if you are a beginner, I would opt for https://www.mises.org/library/economics-one-lesson
Other than seeing the videos and listening to the interview, I have yet to read the book. The book may help an analyst learn how to form their ideas into a concise report. Remember than many money managers have nano attention spans, so you must get your idea across quickly in a compelling way.
That said, one area that might not have been covered is how to KNOW THYSELF! What approach fits your interests, skills and talents and how do you accomplish the goal of knowing your circle of competence? Then how do you learn from mistakes? How do you track your learning and results? Because of randomness, learning from past investments is more difficult than it appears. Spend as much time studying yourself as the company you are pitching!
The above is not a knock on the book; I believe self-knowledge is an underemphasized skill of the investment game.
Article announcing Stoic Mindfulness and Resilience Training (SMRT) 2017 with details of live webinar sessions, etc.
Enrolment is now open for the Stoic Mindfulness and Resilience Training (SMRT) 2017 online course. This is a free eLearning course, which Donald Robertson has been running once or twice each year for Modern Stoicism since 2014. You can access the preliminary area now and the four weeks of the course will officially begin on Sunday 16th July, when enrolment will close. This year over 500 people enrolled within the first 48 hours after it was announced on social media. Around 650 people are now enrolled and we anticipate that will have increased to nearly 1,000 by the course start date.
In the first year, over 500 people took part in SMRT and data was collected from participants, using the Stoic Attitudes and Behaviours Scale (SABS) and a battery of validated outcome measures of the kind used in research on CBT and positive psychology. You can download a PDF of our report here showing the findings in detail: SMRT_Report_2014
CSInvesting: Though this philosophy takes active practice, you might find developing the ability to control your thoughts and reactions to what you encounter in daily life helpful–especially in dealing with Mr. Market. Below is a schema of Stoicism (Click on diagram, then enlarge through your browser to read text).